Telstra improves, but not enough

By Cosima MarrinerNovember 9 2002

The Federal Government's review of regional communications has found Telstra's performance in the bush has improved but has failed to convince farmers and those who will decide if the carrier is sold off.

Although Telstra's chief, Ziggy Switkowski, touted the inquiry by Dick Estens as "an excellent report card", many others, including the National Farmers' Federation vice-president, Wayne Cornish, claimed it merely confirmed that services in the country were "still not up to scratch".

The Estens report, released yesterday, has also done little to sway Labor, the Democrats, the Greens and key Independent Senators from their staunch opposition to the Government's plan to fully privatise Telstra.

The Government must win four extra votes in the Senate if it is to sell the remaining 50.1 per cent of the carrier.

As widely expected, Mr Estens found services in the country had improved over the past two years.");document.write("

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His report said mobile services in the bush would be "adequate" by 2004 when 98 per cent of Australians would have terrestrial mobile coverage. But more progress was needed, particularly on improving fixed-line phone services, internet dial-up speeds and broadband internet access.

To address these shortcomings, Mr Estens recommended the continued govern-ment subsidy of satellite mobile phones and imposing a special licence condition on Telstra to guarantee a minimum Internet dial-up speed of 19.2 kilobits per second.

To ensure services continue to improve, Mr Estens wants a regular independent review, part of a broader regional telecommunications plan to be funded by the Government.

The Government has consistently stated it will not sell its remaining 50.1 per cent stake in Telstra until it is satisfied telecommunications services in rural and regional Australia are "up to scratch".

It established the Estens inquiry to determine how far services had progressed since the Telecommunications Service Inquiry conducted by Tim Besley in 2000.

After studying 606 submissions and consulting 40 different interest groups, Mr Estens found the Government had responded comprehensively to the findings of the Besley inquiry and was addressing concerns it raised.

As a result of the Besley inquiry, the Government spent $163 million on improving basic phone services, mobile coverage and internet speeds.

The Democrats' communications spokesman, John Cherry, said the report recognised the important role the Government played in ensuring equitable access to telecommunications.

"The Estens report makes out a good case for increasing Government ownership of Telstra, not reducing it," he said.

The Opposition labelled the Estens report "a complete whitewash" designed to pave the way for the full privatisation of Telstra.

The leader of the Greens, Bob Brown, said the inquiry confirmed the need to keep Telstra publicly-owned. "Talk of a special fund to guarantee Telstra services in the bush is an admission that with a privatised Telstra it would be more difficult to do just that," he said.

The Federal Government will now consider Mr Estens's findings and recommendations "as a matter of urgency", before deciding its next step.

It will also consult with the competition watchdog, the industry ombudsman and the Australian Communications Authority about the report's implications.